Concise Consolidation – A Brief Guide to Debt Management

Nowadays, regardless of the outfit, retailers cater to shoppers of all needs, whether it is offering flexible, easy payment plans or providing consumers access to quick cash in the form of payday loans and other convenient funding. However, after financing our entire lives, many of us wake up with a hangover of uncontrollable debt, which can spiral out of control quickly. It’s an unpleasant situation to find yourself in and one that most people want to avoid at all costs.

For those with serious debt issues, the dark cloud of unending payments, ridiculously high interest rates, and major damage to your FICO score can get in the way of some long-term plans, such as purchasing a property or maybe opening a business.

Unlike in the past, nowadays you can actually reduce the stress of out-of-control debt through debt consolidations loans, such as debt consolidation loans by Latitude and other providers. These types of loans typically come as a part of a debt management program, so not only do consumers benefit from the loan itself but counselling from the provider can also help with recurring problems with debt in the future.

What Exactly Is Debt Management?

Debt management involves more than just paying your bills on time. In fact, many debt management programs help consumers to learn better ways to control their debt, to use debt to their advantage, and to really understand the perils of debt. Ultimately, the goal of a debt management program is to free the individual of out-of-control debt by drafting a budget, contacting creditors, and if necessary, assisting with debt consolidation loans to streamline their debts.

In addition, many programs also teach you simple and effective ways to save money, provide information about interest rates, and teach you the difference between good and bad debt through various educational programs. Most programs, though, focus on teaching responsible spending habits. Someone drowning in debt will not only get assistance with immediate financial problems, but they learn to adopt responsible spending habits going forward.

What You Should Know About Debt Management Programs

When seeking out the help of a debt management program, it’s important to keep a few key considerations in mind. While some programs are non-profit, the fact is they have to keep their operations running and, therefore, will charge a nominal fee every month. Also, many debt management programs do not allow you to open new lines of credit.

Debt management can also adversely affect your credit score if you are current with all of your payments as a result of the debt management organisation renegotiating your loans. In some cases, you might find it easier to renegotiate your accounts with the creditors themselves. Debt management only benefits your credit score when your accounts are in arrears.

How Are These Programs Beneficial To Consumers?

The benefits of a debt management program are that, for one, these loans streamline all of your payments into one easy-to-manage bill, which reduces the amount of money you spend on monthly interest for each separate account. Some organisations might be able to eliminate the late fees on future payments to creditors.

The best part of debt management is that the interest rates on your accounts will significantly drop. Debt management is always a better alternative to bankruptcy in that these programs make paying bills more affordable and they allow you to reestablish your credit while bankruptcies remain on your credit history for years.

Financial Freedom Through Debt Management

Many find it difficult to see the light at the end of a tunnel of unending debt. The phone calls from credit card companies, the numerous bills that show up in the mail, and having a poor credit score are only a few of the reasons to consider debt management services. Ultimately, these organisations will help you to resolve financial your financial issues and allow you to plan for a solid financial future with confidence.

About The Author

Chris

I have been writing and editing articles about personal finance since we started MoneyHighStreet.com in 2006. In that time, I have been fortunate to have had a regular broadcasting spot on BBC Radio Essex and have also appeared on BBC Rip Off Britain and ITN.
With a family comprising two teenagers, a wife and a bouncy black labrador, getting the finances right is clearly important. It's a privilege to share our tips and experiences to help you manage your money just that bit better.